Sun Life Financial Inc. is reporting a reduced profit for the fourth quarter ended Dec. 31, 2003 due $211 million provision for potential costs related to the improper-trading investigation at its Massachusetts Financial Services Co. unit.

The insurer said its net income for the fourth quarter was $206 million, or 34¢, down from $310 million, or 50¢ a share, a year ago.

.”The mutual fund industry in the United States is currently under scrutiny regarding mutual fund practices. We will continue to work closely with MFS in responding effectively to these regulatory concerns, said Donald Stewart, Sun Life CEO, in a news release “

Sun Life noted that its operating profits grew strongly, on continued growth in the company’s Canadian operations, including its takeover of Clarica Life.

Excluding the special charge, Sun Life’s operating profits hit a record $417 million in the quarter, up from $394 million in the 2002 period. Quarterly revenues, however, fell to $5.4 billion from just over $6 billion – almost entirely because of the currency translation effects from the rising Canadian dollar.

For the full year, net profits at Sun Life rose to $1.3 billion from $998 million, while annual revenues fell to $22.1 billion from $23.1 billion.

Sun Life also announced a 24% increase in the quarterly dividend to 21¢ per share.